Well, first off a soft upgrade is unstable and not even a true jailbreak.

I would recommend you restore to 1.1.4, then download ziphone from here.
Then, you need to run the program/extract it
(if on vista make sure to run as an administrator/you may need to run in compatibility mode, XP)
Then select jailbreak, iPod touch is next to this option
Now, go into Contacts app as soon as the home screen appears, add new contact, type in random characters, select cancel, then press the home button.
Now you can add new sources and all this. If you need help on what to install, look in my signature.

gl

btw, 1.1.3 and 1.1.4 are basically the same, and 1.1.4 is the latest firmware

or if you want to stay on 1.1.3 then right after you jailbreak open up contacts and just start typing for like a minute in the contacts. make a new one and just type anything then save it. restart you ipod and you can delete the contact after that but try that out and it should work